U.S.-EU ‘Open Skies’ Near Arrival

The new “open skies” deal between Washington and Brussels, which aims to continue deregulating airline marketing and operations between the U.S. and European Union, looks set for approval by transportation ministers from the 27 EU members on June 24, say people close to the talks.

Reuters

A Brussels Airlines plane takes off from Zaventem international airport on April 20, 2010.

The pact, agreed on March 25, seeks to solidify and expand liberalization begun in the first U.S.-EU open skies deal, which came into force in 2008.

The first deal was a model for opening tightly regulated aviation markets around the world, say aviation officials. Further progress will be slow, because aviation is saddled with thousands of restrictive bilateral treaties that limit airline ownership, routes and cooperation. U.S.-EU Open Skies I only really addressed some marketing and operations — it didn’t touch the thorny issue of airline ownership. But it began chipping away at decades-old rules that shackle each airline to a single country; the U.S. accepted the idea of an “EU airline”.

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U.S.-EU II tackles fairly technical stuff and doesn’t go much further than the first pact in areas that most airlines or passengers will see. But rejection of the second stage would be a blow for liberalization. Acceptance won’t change much for airlines in the near term, but maintains momentum for some level of deregulation.

With the deal almost in hand, the U.S. State Department’s top negotiator on the deal, John Byerly, last week announced he will retire around the end of September. Mr. Byerly, the Deputy Assistant Secretary for Transportation Affairs for ten years, has struck dozens of open skies deals around the world, and gained a reputation as a canny bargainer.

The success of the first U.S.-EU deal, agreed in 2007 after many years of fruitless talks, has been widely credited to Mr. Byerly, his colleague Paul Gretch at the U.S. Department of Transportation and to the EU’s negotiator Daniel Calleja-Crespo. All three are widely respected by airline officials for their knowledge of the industry and no-nonsense approach.

Now the question in airline-politics circles is how long Mr. Calleja will stay on as Director of Aviation at DG MOVE, the EU’s transportation commission. Like Mr. Byerly, Mr. Calleja has been handling aviation for years and chalked up many accomplishments, from negotiating the open skies deals to helping create the EU airline blacklist, which many say has helped boost air-safety worldwide.

Betting by Brussels insiders is that Mr. Calleja will stay in his post through the triennial assembly of the UN’s International Civil Aviation Organization in Montreal at the end of September.

Then comes the question of who replaces Messrs. Byerly and Calleja. But with the big U.S.-EU deals nearly cemented and little more on the radar for the near future, their positions will become much less significant. Which helps explain why they’re now gazing at the exit.

About Real Time Brussels

The Wall Street Journal’s Brussels blog is produced by the Brussels bureau of The Wall Street Journal and Dow Jones Newswires. The bureau has been headed since 2009 by Stephen Fidler, who was previously a correspondent and editor for the Financial Times and Reuters. Also posting regularly: Matthew Dalton, Viktoria Dendrinou, Tom Fairless, Naftali Bendavid, Laurence Norman, Gabriele Steinhauser and Valentina Pop.